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Covid-19 Measures: Updated to 5 January 2021

As the third Covid-19 lockdown took effect on 5 January 2021, the Chancellor announced a further £4.6 billion in grants to the retail, hospitality and leisure sectors. This new round of support follows extensions to the job retention and loan schemes revealed on 17 December 2020. There may be more to come with the Budget on Wednesday 3 March 2021.

New lockdown 3.0 grants

An extra £4.6 billion in lockdown grants has been directed at the worst affected sectors.

New one-off grants for closed retail, hospitality and leisure businesses have been announced. The new grants are in addition to all other forms of support, such as the Lockdown Restrictions Support Grant (LRSG (Closed) Addendum) which applied to businesses that were forced to close between 5 November  and 2 December 2020.

The new grants in England will be:

  • £4,000 for businesses with a rateable value of £15,000 or under;
  • £6,000 for businesses with a rateable value between £15,000 and £51,000; and
  • £9,000 for businesses with a rateable value of over £51,000.

In addition, £594 million is being made available for Local Authorities and the Devolved Administrations to support other businesses not eligible for the above grants, that might be affected by the latest restrictions. Businesses should apply to their Local Authorities.

The Devolved Administrations will be receiving additional funding in line with the English measures, with £375 million for Scotland, £227 million for Wales and £127 million for Northern Ireland.

The announcement of the new grants talks of helping business “through to the Spring”, with the Chancellor hinting that additional support measures are to come in the Budget on 3 March 2021.

Coronavirus Job Retention Scheme (CJRS)

The CJRS furlough scheme is now running through to April 2021.

On 17 December 2020 the Chancellor announced a further one-month extension of financial support under the Coronavirus Job Retention Scheme (CJRS) to the end of April 2021. As currently, the government will pay 80% of the salary of employees for hours not worked up to a maximum of £2,500. Employers will only be required to pay wages, National Insurance Contributions (NICs) and pensions for hours worked; and NICs and pensions for hours not worked.

Claims for furloughed employees can only be made for those who were employed and on payroll on 30 October 2020. The employer must have made a PAYE RTI submission to HMRC between 20 March and 30 October 2020, notifying a payment of earnings for that employee. This may differ where an employee has been made redundant, or they stopped working on or after 23 September 2020 and have subsequently been re-employed.

Self-employed Income Support Scheme (SEISS)

No change.

No changes to the SEISS were announced alongside the CJRS extension, as the SEISS already runs through to the end of April 2021. Details of the fourth SEISS grant that will cover the three months from February to April have not yet been released.

Loan schemes

Most schemes extended to 31 March 2021.

On 17 December the Chancellor extended access to the Bounce Back Loan Scheme (BBLS), Coronavirus Business Interruption Loan Scheme (CBILS), and the Coronavirus Large Business Interruption Loan Scheme (CLBILS) until the end of March.

Additional support measures

In November 2020 the Financial Conduct Authority (FCA) published fresh guidance across a range of issues including mortgages and consumer credit and loans. The thrust of these was to limit the maximum payment holiday to six months, which had to be agreed three months at a time.

If you have any questions please do not hesitate to contact us.

PK Partnership cost of financial advice

In Focus | Winter 2020

In Focus Winter 2020

As we come to the end of this difficult year, the effects of the pandemic are still playing out. While there is good news on the efficacy of vaccine trials, there is still some way to go before we regain a sense of normality.

Many have seen a dip in incomes, with both investment and pension portfolios affected by market turmoil over the year. We look at the need for ensuring your portfolio is suitably diversified, as well as the impact on retirement plans. Elsewhere savers have been hit by interest rate reductions, while pandemic confusion has seen a huge rise in fraud schemes and scams.

One way you can take some control, however, is in your year end tax planning, making the most of your reliefs and allowances before expected tax changes in the spring.

Click here to read the latest issue of In Focus.

 

Image courtesy of Flickr_Sheila Sund

Beat the scammers

Investment and pension scams are becoming ever more sophisticated, from fancy fake websites to the ‘cloning’ of authorised businesses. Rule number one is always to reject unexpected offers.

Rule two is that, if it looks too good to be true, it probably is. If in doubt, check the FCA ScamSmart site (www.fca.org.uk/scamsmart) and ask our advice.

Image Courtesy of Flickr_Ishan Manjrekar

Rupees, Pounds or Dollars? The Asian Art Market in Review

Guest blog from one of our preferred valuation partners, Doerr Dallas Valuations.

Author: Laura Williams, Indian Art Specialist.

Nobody anticipated the extreme highs of the past few weeks. Particularly in what may potentially be the worst recession of our lifetime. In Mumbai, the room was devoid of clients but that did not alter the fact that the most expensive artwork by an Indian artist had just been sold. There must have been a smile underneath the masks of Dadiba & Khorshed Pundole. The owners of Pundole’s Auction House had just sold a painting by V S Gaitonde on the hammer, for just over £3.6 million pounds. Years of hard work paid off. The record had been set.

With hardly time for the world-record Gaitonde to be taken off its nail, down the road and hot on its heels, Mumbai’s other leading auction house Saffronart was putting up its remarkably similar work, again by V S Gaitonde. Celebrating twenty years of Auctioneering, the Vaziranis pulled out all the stops and without a single-owner collection had pulled together a strong selection of works by leading practitioners. The hammer at Saffronart, like an echo across the City, came down on the Gaitonde, just short of the recent record. Those used to the big-buck rooms of the International art world may give a conciliatory nod to these figures. But consider that in 2013 the same Gaitonde artwork could have been picked up for around £500k and in 1980 it may have cost a modest £500. Oh, how collectors of South-Asian art, like all aficionados, must wish for a time-machine.

For a few years the name Gaitonde has been like dangling a golden carrot in front of the noses of collectors. Equally exhilarating, at the same sale at Pundole’s was the sale price of close to £1million pounds for a work by J S Swaminathan. And it has been the same story for the past few, lockdown, months. The Insta feeds of the auction houses flash at almost the same speed as the rise of the announced prizes, declaring, ‘The highest price achieved for the artist’. The party we are invited to appears to be getting bigger and the list of names added to its celebrity artist list is expanding.

When India embraces an idea, it does so with full gusto. Particularly when it comes to investment potential. ‘I know a great street-food chef’ can transform in the blink-of-aneye into, ‘Business Woman Launches her 200th Food Truck!’ Likewise, a Zarina print can quickly morph from a £10,000 estimate into a £50,000 artwork – as seen at the recent sales. According to Rob Dean, Director of Pundole’s, ”The market may currently be inflated due to worldwide lockdowns but do I think the South-Asian art market is set to be one of the biggest markets in years to come? Yes, I do”.

You could have heard the proverbial pin drop at this week’s Sotheby’s sale of Modern and Contemporary South-Asian Art in London. Lot 40 by Indian artist Bhupen Khakhar made a dazzling £2 million pounds (inc premium) against a suggested price of £250,000 – £450,000. The wide-ranging estimate, a great pointer to the fact that even the experts are not quite sure where the star pupils sit. But the sound of the hammer sadly sounded hollow, just a few lots later, when the stunning oil on canvas, a 1969 work by the much loved V S Gaitonde, failed to sell. The story was the same earlier in the month, when a similar canvas by the same artist also failed to get off the starting block at Christies in New York. The significance of right place, right time and knowing the difference, for each artwork, is evidently crucial.

What does this tell us? The primarily domestic, South-Asian, art market is clearly happier spending its rupees than its pounds or dollars. Perhaps most encouraging, is that a discerning eye appears to be coming into play. Take a tale of two paintings by the respected artist N S Bendre. Two poor examples appeared in Sotheby’s sale, one scrapping past its low estimate of £15,000, the other fai led to sell. Whilst two canvases, of a similar size and year, strong works, sailed past their estimates to achieve around £110,000 and £148,000 each, including premium, at the Saffronart

Auction two weeks earlier in Mumbai. Let’s hope this throws the ridiculous priceper-inch calculator that dealers of South-Asian Art are so fond of, well and truly out of the window and that buyers are understanding that not every Husain is a good Husain.

So, cheers for some and commiserations for others in what appears to be a market that is at last finding its feet. But in this growing arena whilst knowledge of the current sales will be of importance to the UK Insurance industry, this rising market will also mean that many owners of artworks from South-Asia are probably significantly underinsured. Art as a commodity can be tricky. We understand the process of valuation. But it is never as simple as it seems. Finding a valuer for many can be an unknown entity or simple not top of the to do list.

It is a new part of the same old story; we buy art because we love it, for investment and often secretly for both. Artworks get passed down through families, normally with a tale to tell about how Grandpa picked up the sculpture when he was in the East.

Sometimes these are cherished pieces, often tastes differ through the generations. The painting gets put on top of the wardrobe. We have all seen the faces of the owners of such artworks on the TV, being told by the expert that it is probably worth a couple of hundreds of pounds. But not so in the South-Asian, particularly the Indian, art context.

Here the roles are reversed. Pieces thought to be worth a few pounds are often valued in the thousands and beyond.

For those expats and non-resident Indians who bought artwork on their travels, it may be worth looking up from this article and scrutinising the artwork hanging above the desk, in the same place it has been for the past thirty years. Unlike our other assets we let value hide in our homes as it is the easiest option. It is rare that those left a house in a will would take a tour, exclaim its beauty, then lock the door and walk away. Like houses, art has value. In some cases, it can even exceed the value of the wall it sits on.

To arrange a confidential review of your personal insurance including art collections, high value home building and contents, wine collections, high value performance and classic cars, please contact our Private Clients Manager, Kim Shergold, on 020 8681 4994

 

PK Partnership cost of financial advice

Video witnessing for wills

The Government is changing rules to allow remote witnessing of wills via video calls in England and Wales. It is already legal in Scotland, but not yet in Northern Ireland.

New legislation in September 2020 will backdate the measure to 31 January 2020, but two witnesses will still be required. The change will last through to 31 January 2022 or as long as necessary through the pandemic.

The FCA does not regulate will-writing.

Autumn 2020 | In Focus

PK Autumn newsletter

With people starting to return to the office and schools and universities reopening, it appears that life is beginning to tentatively resume its usual rhythms this autumn. As the longer term effects of the lockdown become apparent, we look at some short term future implications of the pandemic – such as student loans and the upcoming Budget. We explore how ESG funds have been performing during the last few months and investigate whether the summer changes to stamp duties make buy-to-let a more attractive investment. We also explore how some women’s state pensions may have been underpaid. As ever, if you are affected by any of the topics, we’re here to help.

Click here to read the latest issue of In Focus.

Image courtesy of Flickr_Pink Sherbert Photography

Sharp fall for dividends

UK dividends were down more than 50% in the second quarter of 2020.

The pandemic has hit the global economy hard and devasted the dividend payments of many leading UK companies. Between April and June 2020, total UK dividend payments were 57.2% lower than in the second quarter of 2019, according to Link Asset Services.

Many companies – notably the big banks – stopped dividend payments altogether.

Despite the cuts, Link’s worst-case-scenario is that UK shares will provide an income yield of 3.3% over the next year – still much better than current deposit rates.

The value of your investments and the income from them can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.

Investing in shares should be regarded as a long-term investment and should fit in with your overall attitude to risk and financial circumstances.

PK Partnership Budget Savings and Pensions

Things are slowly returning to normal…

As Government lockdown measures continue to ease for most sectors, we have started our phased return to the office, operating a skeleton staff throughout the week.

Our switchboard number 020 8681 4994 is fully operational and individual members of the team can still be reached directly:

Wealth Management & Mortgages

Jonathan Kelly – 020 8256 9984

Gina Gasparino – 020 8256 9990

Carmel Jones – 020 8256 9982

Estate Planning

Prakash Patel – 020 8256 9983

Aine O’Flaherty – 020 8256 9985

Insurance

Amit Patel – 020 8256 9986

Kim Shergold – 020 8256 9981

Mahend Roopchund – 020 8256 9980

Danny Levett – 020 8256 9989

If you have any questions relating to your financial or insurance arrangements please do not hesitate to contact the team on 020 8681 4994.

In the meantime, we hope you are enjoying a safe and happy summer.

Image Courtesy of Flickr_Ishan Manjrekar

Summer Statement 2020

An unprecedented Summer Statement was delivered today by the Chancellor of the Exchequer, Rishi Sunak.

Although the economy is starting to open up gradually after its pandemic-enforced quarantining, the chancellor’s statement is an attempt to stem the damage from a forecast 14% slump in GDP this year, according to the Bank of England, and a potential rise in the unemployment rate from 3.9% to 15%, according to the Organisation for Economic Cooperation and Development.

About the Budget

This snapshot is not an in-depth analysis but aims to give you a quick summary of the key points announced by the Chancellor from the dispatch box.

More details are available from GOV.UK

Main Headlines from the Speech

Introduction

  • Extraordinary measures introduced to offset effects of Covid-19 virus
  • £160bn spent by Government in addressing the Corona virus crisis
  • Economy contracted by 25% in first six months of year
  • Government will not be defined by the crisis, but by their response to it

 

Economic Measures

  • Three point strategy to support, protect and retain jobs
  • Furlough scheme to be wound down gradually from October
  • £1,000 bonus payable to employers for retaining furloughed employees
  • ‘Kickstarter’ job package for 16-24 year olds
  • Government subsidy worth up to £6.5k for each employee taken on under Kickstart Scheme
  • £2,000 bonus for employees taking on trainees
  • £1,500 bonus for apprentices over age 25
  • Companies able to apply for job subsidies within one month
  • Additional funding for the National Careers Service
  • Help for long term unemployed
  • £1.6bn additional funding for DWP

 

Infrastructure/Housing

  • £3bn scheme to make homes and buildings more environmentally friendly
  • £2bn Green Homes Grant to make homes energy efficient – up to £5k per household
  • £1bn to improve energy efficiency of public buildings
  • Property transactions fell by 50% in May
  • Stamp duty threshold raised to £500K (from £125K) until 31/3/21 effective immediately.
  • Predicted 9 out of 10 people will pay no SDLT this year.

 

Hospitality and Tourism

  • 1.8 million people employed in the hospitality and tourism sector. 1.4million workers in the sector have been furloughed. 80% of sector stopped trading in April
  • VAT on food, accommodation and attractions to be cut to 5% from 15 July until Jan 12th 2021
  • August special – ‘Eat out to help out’ – 50% discount available Mon to Weds worth up to £10/head (at participating establishments).

 

Image courtesy of smee.bruce, Flickr

Financial Focus: Summer 2020

No one could have predicted how the last few months have turned out. The disruption to everyday life seems set to continue, with coronavirus lockdown measures easing but still bringing us nowhere near to our to ‘pre-Covid-19′ lives. The same can be said for the stock markets, which have seen sharp falls; the investment landscape has certainly shifted – if not permanently, then for the forseeable future. This naturally has implications on personal financial planning, savings and investments, protection and pensions. Will-writing and estate planning has also seen a recent increase in demand, for sobering reasons, but the astonishing fund-raising accomplishments of Captain Tom Moore highlight the importance of planning for long and productive later lives. In this edition we bring you an overview on how these globally altered circumstances may impact on your own financial positions. Click here to read our summer newsletter. FOCUS Summer 2020 INSTAGRAM

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